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The State of Jefferson was established by American colonists in northern Mexico in 1782. The colonists were supporters of American independence who chose exile after the American defeat in the North American Rebellion. The colonists took part in the Wilderness Walk, traveling from the colonies to the Tejas region of New Spain between 1780 and 1782. There, in the fall of 1782, they founded the settlement of Jefferson City, which formed the nucleus of the State of Jefferson, named after Thomas Jefferson, author of the Declaration of Independence.

The settlement at Jefferson City grew as more colonists moved there from the newly-established Confederation of North America in the 1780s and 1790s. Following the invention of the cotton gin in 1793, cultivation of cotton in Jefferson increased dramatically, providing a secure economic foundation for the settlement. Cotton cultivation also resulted in a new wave of settlement from the Southern Confederation, as well as permanently establishing slavery in Jefferson.

Also in 1793, Alexander Hamilton and James Madison organized a convention to adopt a new system of government for Jefferson, held in the settlement of Lafayette in the summer. The Constitution of 1793 adopted at the Lafayette Convention established a government divided into legislative, executive, and judicial branches. The legislative branch consisted of a forty-two member Chamber of Representatives elected by free male property holders and a fifteen-member Senate chosen by the Chamber. The executive branch consisted of three Governors chosen by the Senate. The judicial branch consisted of a seven-member High Court nominated by the Governors and ratified by the Senate. The Constitution was ratified by the Jeffersonians on 15 October 1793, and elections for the Chamber were held on 4 December. The Chamber met in Jefferson City on 19 January 1794 to choose the Senate, and the Senate met on 25 January to choose the Governors: Madison, Hamilton, and Samuel Johnston of North Carolina. An ideological split soon developed among the Jeffersonians, with supporters of expansion joining together to form the Continentalist Party while their opponents, influenced by the ideals of the Rebellion, formed the Liberty Party.

The Jeffersonians remained under nominal Spanish rule until the outbreak of the Trans-Oceanic War in 1795, when they began conquering the territory surrounding their settlement. By the end of the Trans-Oceanic War in 1799, the State of Jefferson had secured its independence and gained control of the coast of the Gulf of Mexico between New Orleans and the Rio Grande.

The Jeffersonians initially remained neutral when Mexico gained its independence from Spain in 1805 and promptly fell into civil war. However, in 1816 a Jeffersonian army under Colonel Andrew Jackson was sent to intervene in the war. By 6 February 1817, the Jeffersonians and their Mexican allies had taken Mexico City. Jackson oversaw the meeting of a constitutional convention in Mexico City in September 1820 attended by delegations from both Mexico and Jefferson. The Mexican Constitution of 1820 resulted in the merger of the two nations, with Jefferson becoming one of six states forming what was now the United States of Mexico, or U.S.M. The Constitution of 1793 may have been amended or superseded at this point, since there is no further mention by Sobel of Jefferson having multiple governors.

The members of Jackson's Continentalist Party who had supported his program to unite Jefferson and Mexico had expected him to create a "greater Jefferson", rather than the bilinguial, multiracial U.S.M. created by the Mexico City Convention. This may explain how the Liberty Party was able to gain the election of Leslie Folger as Governor of Jefferson in the 1821 Mexican elections. Folger became the leader of the Libertarians in 1824, and was the party's presidential nominee in the 1827 Mexican elections. During the election campaign, Folger lied outrageously about Jackson's personal life and wealth, though Jackson made no attempt to silence him.

During Jackson's Grand Tour of 1823, he received a tumultuous greeting in Jefferson City, and in his speech before its legislature he compared the state's prosperity to that of the Southern Confederation, disparaging that of the latter. The state's prosperity was enhanced by loans from France and other foreign countries, and by the establishment of textile mills by French businessmen. An unexpected side effect of the state's growing industrialization was that Mexicano and Indian peasants began to leave the farms and plantations and find work in the mills, thereby qualifying for the vote. The number of free Mexicanos and Indians also increased in the other states, so that when seats in the Assembly were reapportioned after the 1830 census, Jefferson's share fell from its original 34 out of 100. This trend continued, so that after the 1850 census, Jefferson's share of the Assembly fell to 24 seats.

The Panic of 1836 affected Jefferson's economy in much the same way as it did that of the Southern Confederation, with a sudden drop in the demand for cotton leading to a similar drop in the price of slaves. However, unlike the S.C., the Jeffersonians did not respond by abolishing slavery. Instead, the slave markets in Jefferson City and Quatros Hermanos were closed. When the price of slaves recovered in 1842, the slave markets reopened, doing better business than before. However, Jeffersonian cotton began to face competition not only from the S.C., but also from Egypt, India, and South America. The result was a catastrophic fall in the price of cotton from 35 centavos per pound in 1837 to less than half that in 1846. Cotton planters responded by increasing their production of cotton, which raised the price of slaves, but kept cotton prices low.

The discovery of gold in California in 1838 had an even greater impact on the Jeffersonian economy. By 1844 gold had replaced cotton as the U.S.M.'s most valuable commodity. So many Jeffersonians left for California that the cities of the cotton region all experienced population drops, and even the planters themselves began to consider leaving. One who actually did so was John Mason, who left his plantation in the summer of 1838, and who amassed enough wealth to gain the Continentalist Party's presidential nomination in the 1839 Mexican elections.

Another effect of the gold rush was the founding of the Jefferson and California Railroad Company in 1838 by a consortium of Jeffersonian and French businessmen led by Jethro Baker and Maurice Duforge. The first rails at the Jefferson end of the railroad were laid in Henrytown on 4 February 1839. Although the rail link to San Francisco would not be completed until 1848, the founding of the J & C Railroad set off a transportation boom in the U.S.M. This also had the effect of reducing the influence of the Jefferson planter class.

A final blow to the Jeffersonian planters came in August 1839, when Liberty Party candidate Miguel Huddleston was elected president. Although a Jeffersonian himself by birth, Huddleston had married a Hispano woman and had chosen to identify with the Hispanos, going so far as to change his name from Michael to Miguel. Although Huddleston made no move to limit slavery, he owed nothing to the Jeffersonian planters, and devoted his administration to developing the other Mexican states.

The Jeffersonian planters' crisis of confidence came to a head at the Continentalist state convention in Henrytown in May 1843. It was then that Pedro Hermión gave his Scorpions in a Bottle speech, castigating the Anglo Jeffersonians for their obsession with cotton and warning of imminent war with the C.N.A. Hermión quickly became the leader of the Continentalists, and went on to lead the party to victory in the 1845 Mexican elections.

Colonel Martin Washington in battle.

During the Rocky Mountain War, Jefferson was invaded in April 1846 by a Southern Confederation force with a large Negro contingent. Although Colonel Martin Washington's Fifth Alabama Horse was able to break through the Jeffersonian lines, the invading North Americans were driven back across the Mississippi after two weeks of bitter fighting. The Jeffersonians began to station strong partrols along the Mississippi, and all subsequent North American attempts to cross the river failed. To prevent any slave uprisings in support of the North American invasion of 1846, the Jeffersonians resorted to mass executions of the slaves.

The war caused a shortage of cotton in Europe, and after the two nations agreed to an armistice in August 1853, Jefferson was able to compete successfully with the S.C. in the European cotton market. By the late 1850s, though, increasing mechanization of cotton production reduced the need for slaves. As the planters invested in mechanization, the demand for and price of slaves leveled off and then began to decline. The planters refused to consider manumission, instead choosing to look the other way while their slaves escaped across the Mississippi and Arkansas rivers to the C.N.A. The number of slaves in Jefferson declined from 150,000 in 1855 to 50,000 in 1890. Even though the average female slave gave birth to 3.6 children between 1890 and 1920, the population of slaves in the U.S.M. only rose from 100,000 to 103,000, which suggests that more than half of the U.S.M.'s slaves succeeded in escaping to the C.N.A.

Along with the postwar cotton boom, the discovery of oil in the Tiempo de Dios area in 1863 also boosted Jefferson's economy. Production of oil rose from 10,000 barrels in 1865 to 8.9 million in 1876. The Petroleum of Mexico Corporation, formed by Monte Benedict in 1874, was the leading corporation in Mexico in terms of assets, sales, and profits. Benedict used his growing wealth to push for an expansionist foreign policy. He was quoted in the 12 March 1866 issue of the Jefferson City Tribune saying, "The lands to the south are veritable storehouses of raw materials, but the peoples of these nations lack the resources to extract them. We in Mexico have these resources. A marriage of their land and our people would surely benefit all." Benedict supported SenatorOmar Kinkaid for the Continentalists' presidential nominee, and between his influence and that of Bernard Kramer of California, Kinkaid gained the nomination on the first ballot, then went on to win the presidency with 54% of the popular vote.

When Kinkaid was assassinated on 7 December 1879, the Senate chose Senator George Vining of Jefferson to serve out the remainder of his term. Vining created the Constabulary to put down the Moralista insurgency of Carlos Concepción, and named Pedro Hermión's son Benito Hermión, the President of the Jefferson & California Railroad, to lead it. A raid by the Constabulary on the Workers' Coalition convention in Palenque, Chiapas on 15 July 1881 provoked a national uprising by the U.S.M.'s Mexicanos. The only exception was in Jefferson, where a paramilitary organization called the Jefferson Brigade controlled by Petroleum of Mexico kept the state's Mexicanos under harsh control. When rumors of a slave uprising in Jefferson reached Mexico City, Constabulary agents entered the slave areas, killing over four thousand.

President Vining suffered a fatal heart on 12 September 1881, nine days before the 1881 Mexican elections. Benito Hermión was able to persuade the Cabinet to appoint him Chief of State during the emergency, and he continued to exercise dictatorial control of the U.S.M. for the next twenty years. After the restoration of democratic government in 1902, the United Mexican Party dominated politics in Jefferson. The U.M.P. was under the direction of Kramer Associates, which had merged with Petroleum of Mexico in 1892.

In the wake of the Chapultepec Incident of 4 January 1916, slavery became the foremost issue in the U.S.M. It was not until the election of Emiliano Calles in 1920 that the issue was finally settled by passage of the Manumission Act on 13 May 1920. Under the influence of K.A. PresidentDouglas Benedict, Jefferson's political leaders supported manumission, even though the Jeffersonians had always been the most fervent supporters of slavery.

During the Global War, President Alvin Silva cancelled the 1944 Mexican elections, which provoked an uprising known as the Rainbow War among the U.S.M.'s Mexicanos and Negroes, in Jefferson as well as the rest of Mexico. The loss of China and Siberia during the war cost Silva considerable popularity, and in July of 1949 he announced elections for the following January. The elections were divisive, and Silva's narrow loss to Admiral Paul Suarez resulted in Silva's accusation of balloting irregularities in Jefferson and California. Amid growing protests, Colonel Vincent Mercator, commander of the Guadalajara garrison, led a coup d'etat on 18 January 1950, the day before Suarez's scheduled inauguration. Mercator had been a lawyer in Jefferson before the war, with a modest practice and little hope of advancement. After January 1950, he appointed himself Secretary of War and ruled the U.S.M. from behind the scenes.

Sobel's sources for the history of Jefferson include Dana Wycliff's The Cultural Struggle in Early Jefferson (Mexico City, 1910), Luther Moltke's Across the River Jordan: The Slave Trade and the Vandalia Trek (Mexico City, 1950), Peter Collins' The Liberty Party in Old Jefferson (Mexico City, 1954), Henry Miles' Jefferson in the Trans-Oceanic War (Mexico City, 1956), David Christman's The Origins of Political Parties in Jefferson (Mexico City, 1960) and The Founding of Jefferson City: The First Three Decades (Mexico City, 1967), William Matthias' Like an Old Shoe: The Decline of Slavery in Jefferson (Mexico City, 1961), Frank Dana's The Cotton Culture of Jefferson: White Gold in the Sun (Mexico City, 1967), and Herman Muller's Hermión of Jefferson: Patriot or Traitor? (Mexico City, 1969).